Bids invited for RIL's MP gas pipeline

The Petroleum and Natural Gas Regulatory Board has invited bids for laying a 300-km gas pipeline connecting Reliance Industries' coal bed methane production site in Shahdol, Madhya Pradesh, to Phulpur in Uttar Pradesh.

Earlier this year, Mukesh Ambani-promoted Reliance Gas Transportation Infrastructure Limited had approached the board with an expression of interest to lay the pipeline.

The board would start selling the bid documents on November 22. The deadlines for purchasing the document and filing of bids are March 14 and March 21, respectively, said a PNGRB official. According to RGTIL's expression of interest in June, it had identified 73 potential consumers along the Shahdol-Phulpur route.

These included JSW Ispat Steel, Indiabulls Power, Essar Oil, Nirma, Tata Chemicals, NTPC and Rashtriya Chemicals and Fertiliser. The price of coal bed methane for Reliance Industries and Essar Oil has not been approved for several months. The issue has been referred to C Rangarajan, chairman of the Prime Minister's Economic Advisory Council.

"In the light of the planned coal bed methane gas production from the second half of 2014, expeditious execution is needed for this pipeline,"

RGTIL had said in the expression of interest. RGTIL operates a 1,400-km gas pipeline network in the country.

In October, the petroleum ministry had cancelled authorisations to RGTIL to lay four gas pipelines totalling 2,175 km. Earlier, the company had been authorised to build four trunk pipelines - Kakinada-Haldia, Kakinada-Chennai, Chennai-Tuticorin and Chennai-Bangalore-Mangalore - to be completed this year.

In 2007-08, Relogistics Infrastructure, a subsidiary of RGTIL, had won the mandate to build these pipelines. However, it did not make much progress in construction, owing to non-availability of gas. RGTIL had maintained it could complete the pipelines in two years.

But it wanted to synchronise the construction with gas sourcing. Though it was scheduled the KG-D6 and other eastern offshore gas fields be the source of fuel for the pipelines, owing to the fall in output there and the fact that no other field would come on-stream in the near future, constructing the pipeline wasn't feasible, RGTIL had told the ministry in May.

CAG has asked the oil ministry not to approve any of RIL's investment plans for the flagging KG-D6 gas field unless the company gives it unfettered access to audit its spending.